How Happiness, Sun, Parachutes, And Other Things Make You Make Risky Decisions

Are some people naturally more likely to take risks than others?
Or does it depend on a social situation? A time of year? A time
of life?

The research isn't conclusive — but here's a selection of what
the science tells us thus far.

Happier people take more risks.

If you're feeling high on life, you see the odds as in your
favor.

"When we're happy we take more risks, are more trusting, more
generous," writes University College London professor
Noreena Hertz. "It's why a country's stock market tends to
rise off the back of a national team's win at football. (Not
something England needed to worry about this year, sadly.)"

A
sunny beach: unexpected ally to risk.Peter Kramer/Getty

Sunny summer days open people up to risk.

Research suggests that when the days get shorter, people are more
averse to risk.

Behavioral finance scholar Lisa Kramer has found that it gets more intense the
further north you go — traders in Stockholm get more skittish in
autumn than their peers in Frankfurt, for example.

"As the exposure to daylight diminishes, we respond in a
biological way to the change in exposure to daylight," Kramer said in an interview. "We're not that
different than ancestors who would retreat in the winter time.
When the seasons changed they had to become a lot more
conservative; they had to adopt a lot more conservative
practices. We're still those same people."

Correspondingly, if you want to pitch someone on an outlandish
proposal, she says to wait until the spring.

Teens like to take "unknown risks."

While teens are thought to be rollicking risk-takers, the
research shows the opposite — they overestimate risks around sex
and drug use. In one study, adolescents thought that a
sexually active teen girl had a 60% chance of catching HIV, when
the chance is tiny in real life.

Fascinatingly, even though teens overestimate known risks, they
are more likely than adults to make risky decisions if the
outcome is ambiguous.

"Relative to adults, adolescents engage more in unknown risks
than they do in known risks," says Agnieszka Tymula, a
postdoctoral student at New York University and the lead author
of the study,
which was published in the Proceedings of the National
Academy of Sciences.Teens, it seems, love the
unknown.

They may get lost in the details about specific risks and overly
focused on possible rewards, while ignoring the overall "gist" of
the problem — i.e., the ultimate consequences. In the case of
unprotected sex, for example, even if the odds of contracting HIV
are low, a bad outcome would be irreversible. Unlike teens,
adults tend to focus on the end result and the consequences.

In other words, teens are cool with not knowing what's going to
happen. Therein lies the risk.

The Cypres eliminated "no-pull" or "low-pull" deaths. These types
of accidents are exactly what they sound like — deaths resulting
from divers pulling the cord too late or not at all. The Cypres
opens the parachute automatically if the diver is seconds away
from impact.

Great innovation right? In fact, in 1998, Cypres devices recorded
12 "saves" and there were no low-pull deaths that year. In 1991,
before the Cypres penetrated the market, there were 14 deaths.
The technology of the Cypres worked to make skydiving safer.

But people were still dying during skydives. And in roughly the
same number. What was going on?

The divers were trying riskier landings.

With the added safety of the Cypres device, divers started trying
to execute more difficult landings to impress their friends.
Called a "hook turn," the diver makes a 90 or 180 degree turn
just before landing — and probably dies if he doesn't get it
right.

When the Cypres device became standard issue — and the chance of
a "no-pull" death plummeted — hook turns became popular.

The reason: risk homeostasis.

"The Cypres device practically eliminated the risks of parachute
malfunctions — so skydivers compensated by trying to get
themselves killed in other ways," writes the Agile Lifestyle blog.

You experience this in your own life. If you're driving down a
rainy, winding street, you'll slow down to stay safe. But if that
road opens up into a clear, dry, highway, you'll probably speed
up — yet the chance of getting into an accident is about the same
either way.

The takeaway: We all have an appetite for risk. In extreme cases,
we'll risk our lives to keep it sated.